Harbingers of hope, but BRICS's journey from beggary to bounteousness has not always been smooth, cautions Gamal Nkrumah The "Twitterati" paid scant attention. China and Japan tied the knot. Conjugality, though, was a question of convenience. The partnership was struck after a turbulent past. Reconciliation, compromise and accommodation are apparently some of the Confucian self-defined strengths. In sharp contrast, in the West there is a distinct sense of Schadenfreude. The Chinese and Japanese economies are inextricably linked. This verity brought a tenuous peace to Northeast Asia. There are moral reasons to be sceptical of the latest rapprochement between Beijing and Tokyo. The bitter ideological divisions which have scarred Asian politics since the end of World War II have lessened somewhat. Both Beijing and Tokyo recognise the tensions inherent between the ideological value-based socialist or Marxist-inspired political philosophies and the Realpolitik of the pro-Western Japanese will not be conjured away by wheeling South Korea into play. There is no time to lose. Beijing and Tokyo concur that Korea, unified or not, must be party to the free trade agreement. Asia's giants are laying the foundations of a new Northeast Asia. Politically, they are poles apart -- or so it seems at first glance. China is Communist, Japan practices multi-party pluralism. But this pluralism really just another instance of polyarchy, where the ruling cliques take turns ruling the roost. And against the backdrop of such divisions the current Sino- Japanese détente plasters over a political labyrinth of pitfalls and predicaments. A battle of ideas is under way. Japan, just like China, is an intensely polarising power. In the past the Japanese in particular were feared as onerous, and even tyrannical. The Chinese, too, then and now are regarded with suspicion as overbearing by their smaller Asian neighbours. Even so, the Sino-Japanese entente is celebrated as a watershed in Asian geopolitics. On one level the meeting in Beijing between the Japanese leaders and their Chinese hosts were promising. On another they were a reminder of the past quandaries that doggedly remain. The challenges now are greater still. It is vital for the Asian giants to send a clear message to global markets that they are determined to end the politics of debt-making that have plagued the West. Japanese debt to gross domestic product (GDP) ratio is, strangely enough, twice that of the European Union (EU). Public sector debt to GDP in Japan is over 100 per cent versus 68 per cent for the eurozone, 31 per cent for Asia and 27 per cent for the Emerging Markets, though just how worrisome this is questionable. The apocalyptic earthquake, tsunami and nuclear disaster that struck Japan in March 2011 spotlighted the real vulnerability of the proud island nation. However, the catastrophe may be viewed as a blessing in disguise. The Japanese economic performance is forecast to improve significantly in 2012. A splurge of fiscal stimulus is expected to work wonders, though at the expense of the ever-rising debt to GDP ratio. Well, that some experts say might be wishful thinking. Fatalistically, no plans are afoot to enforce the closure of Japan's 54 nuclear reactors. Is Japan courting disaster? Fukushima metamorphosed from a symbol of success and efficiency into a euphemism for failure, dereliction and bafflement. Radiation levels are alarming and the mothballed reactors a frightening spectre. Interestingly, China controls some 70 per cent of the Japanese national debt. Even as the country is gearing up for a closer commercial and economic relationship with its giant neighbour China, Japan will limp into 2012 with an economy that will continue to hum along snugly in spite of latent anxieties about making a silk purse out of a resource-poor sow's ear. Tragedy has traditionally given a fragile Japan a strong story to tell. Japan's abrasive style during World War II made it plenty of enemies in Asia, including the Chinese. It cost Tokyo the prize it most coveted. Japan was guided by an overreaching philosophy of uniting Asia under its hegemony. Japan's unabashed patriotism in those heady days owed much to its military superiority and economic clout. The impoverishment and underdevelopment of the rest of Asia only strengthened Japan's prestige in the vast continent. Wherever Japanese diplomats, government officials and military officers strode they left an indelible mark on the peoples of Asia. Even as Japan was humbled, proving an easy prey for more powerful China in the ascendant, the Chinese giant spurred by the fabled Asian economic dynamo is reaching for the skies. 2012, after all, is the Year of the Dragon, and the prophets of doom and gloom focus on the domineering and determined nature of the mythical dragon. "Every multinational in the world is rushing into China to try to offset failing sales, but the reality is there are probably more losers than winners," Shaun Rein, head of China Market Research in Shanghai and author of the forthcoming book The End of Cheap China, was quoted as saying in the Financial Times. China and Japan can work together on an equal footing, but if the Chinese Dragon's hegemony and economic pre- eminence swallows Asia up, excessive deference to Beijing may emerge as a curse. According to Italian President Mario Monti, "member states [of the EU] have often shown an unhealthy degree of politeness when it comes to peer review exercises... A large member state has more votes in Council deliberations and more members of the European parliament than a small member state. Thus it has more influence on the legislative process, as is perfectly justified on democratic grounds." Monti, a former European commissioner and distinguished academic (president of Bocconi University) replaced Silvio Berlusconi and his cronies who presided over the lethal downward spiral. So can anything be done to avert the eurozone's fiscal and monetary disaster? According to the Italian president "unhealthy politeness towards each other, and excessive deference to large member states," were to blame for the mess Europe finds itself entangled in. The not-so-bright side of European economic and financial integration serves as a forewarning to Northeast Asia. China is the biggest Asian prize by virtue of history, geography and population. With an estimated 1,400 million people, the People's Republic of China is the world's most populous nation. In addition not only is the ancient Chinese civilisation rightly regarded as the mother culture of contemporary Northeastern Asian nations -- including Japan and Korea, China is strategically located in the heart of Asia. Poverty is rife in rural backwaters and urban shantytowns but China has come a long way. China's current prosperity is in part a tribute to the tenacious persistence and unobtrusive dispassionateness and forbearance of the ruling Chinese Communist Party. With continued rising living standards, a shift to more democracy is inevitable. But the Chinese are in no rush to institute Western-style multi-party democracy, especially if it means a lowering of the people's standard of living. At any rate, Chinese President Hu Jintao and Prime Minister Wen Jiabao are scheduled to hand over their respective posts to Xi Jingping and Li Keqiang in early 2013. Many Chinese believe the Communists must hang in for a while. The democracy enthusiasts disagree. Be that as it may, an estimated 70 per cent of China's leadership, and not just the presidency and prime ministership, are expected to change within the course of the next year. Even so, pursuing Western-style democracy in China is an economic risk, one that the Chinese leadership is averse to taking. But it is also one crucial step that Western powers and Chinese democracy activists believe the country must take. All this adds up to what amounts to a Western retrogression in economic and political terms and on a global scale. Perhaps, all this sounds alarming to some. Asian powers are in the ascendant. Asia's star is fast rising. But will it? The key to answering this question is whether Asia's leaders, and aspiring politicians, are ready to assume the European mantle. The West's dysfunctional economics is worse than Asia's quiescent politics. "Broadly speaking, two tribes have skirmished with each other during the euro crisis: the markets and the politicians. In 2012 the battle will become a lot more complicated, as the politicians splinter into factions. It sounds dangerous -- and it is -- but thrashing out political arguments is an essential part of bringing a crisis to an end," observes Edward Carr in the Economist. The sad truth is that beggar-thy-neighbour policies have a long tradition in Asia. The onus, though, now seems to be on harmonious co-existence. Natural disasters aside, 2012 looks to be a good year overall for Asia. The continent could afford to be more thorough in its economic and political clean-up without resorting to revolution. Economically, the continent and not just China is booming. The economic growth rate forecast for China is 8.2 per cent. The Indian economy, not far behind is predicted to grow by 7.8 per cent. Even Indonesia, with 250 million people, is destined to enjoy an economic growth rate of 6.3 per cent in 2012. Rising domestic consumption coupled with increased export earnings ensured relative political stability. South Asia and Southeast Asia not to mention Northeast Asia have all avoided the shifting sands of the Arab Spring. As the year drew to a close, Chinese Prime Minister Wen Jiabao and his Japanese counterpart Yoshihiko Noda met at the Great Hall of the People in Beijing to discuss bilateral relations, trade and the future of the Korean Peninsula after the passing of Kim Jung Il in Pyongyang. The two leaders agreed in principle to sign a free trade agreement. China and Japan, after all, are the world's second and third largest economies after the United States. Asia's two biggest economies have a volume of trade that exceeded $340 billion in two-way transactions last year. The two leaders also explored means of direct trade in goods and services with their respective currencies, the yen and the yuan, without the use of the US dollar. Moreover, Japan announced its intention to buy more Chinese bonds. In short, China and Japan agreed to forgo the beggar-thy- neighbour type economic policies of the past. Over time that might prompt a much needed consolidation of the political system in Southeast and Northeast Asia. After all, both Japan and China suffer from their close ties to Washington. In Japan's case, the association is obvious as epitomised by Okinawa; in China's case, more subtlely through US manipulation of China against the former Soviet Union and now through financial blackmail because China has been forced to hold massive quantities of possibly worthless US Treasury bonds, playing Shylock to the America Antonio. Asia resurgent depends in large measure on cooperation with other emerging economic giants the so-called BRICS -- Brazil, Russia, India, China and South Africa. There are other contenders, too. Indonesia, Mexico, Turkey and even at some hopefully not so distant future Egypt and Pakistan. Deplorable income disparities persist in the BRICS with the rich becoming increasing wealthier and the poorest of the poor more desperately impoverished and politically disfranchised. The turnaround is the fruit of faster economic growth rates. "The world is changing fast. We are experiencing an inflexion in the global distribution of wealth, with a number of countries emerging as new centres of economic and social development. Brazil is one of these new centres. More important, in the past years we have lifted over 40 million Brazilians -- almost the size of Spain's population -- out of poverty and into the middle classes with access to health, education, credit and formal employment," notes Brazilian President Dilma Rousseff. China has been transformed dramatically since Mao Zedong denounced John Maynard Keynes's General Theory, published in 1957, as "anti-science and anti-people". It has transformed capitalism itself with its Communist- tsunami inspired market socialism. Now it is taking on board Japan and playing the role model for the BRICS to emulate. The pressing question is whether other BRICS will follow suit?
